Author
Topic: Sam Hinkie Letter (Read 5514 times)

I actually think this letter is a great example (and there have been others recently) of how hedge fund guys are extremely susceptible to non hedge fund guys who "talk the talk" regardless of whether they walk the walk long term. More than anything else, I think it explains how Hinkie was able to convince them to do the "process" for years and years.

The walking the walk of being an NBA GM is actually drafting/acquiring good players. Hinkie has totally failed at that. Only Embiid, arguably, has potential but seems almost certainly headed down the Greg Oden path.

I thought comparing himself to Buffett was particularly rich. Buffett shut down the partnership after over a decade of amazing returns. So far, Hinkie has lost a ton of games and acquired potentially 2 very high draft picks and that's it.

He may not have won many games but he invested in his teams future. He left the team loaded with draft picks. He may or may not have been successful in the long run, but I respect what he was trying to accomplish, I see a turnaround in the near future.

Thanks for sharing this data. To use this data in a business context. This company( team) has a lot of assets that aren't earning a return. A activist would salivate to take control of this company and increase the earning power of the business. So this company (team) is a cigar butt. Time is its enemy.

Except the assets that aren't earning have a hard catalyst (the draft) when they will convert into valuable players.

I think a better analogy is a company that had done a bunch of capital spending on something (new plant, real estate development whatever) that hasn't started earning yet.

He may not have won many games but he invested in his teams future. He left the team loaded with draft picks. He may or may not have been successful in the long run, but I respect what he was trying to accomplish, I see a turnaround in the near future.

Thanks for sharing this data. To use this data in a business context. This company( team) has a lot of assets that aren't earning a return. A activist would salivate to take control of this company and increase the earning power of the business. So this company (team) is a cigar butt. Time is its enemy.

Except the assets that aren't earning have a hard catalyst (the draft) when they will convert into valuable players.

I think a better analogy is a company that had done a bunch of capital spending on something (new plant, real estate development whatever) that hasn't started earning yet.